BAE SYSTEMS Controls Signs Long-Term Lease At Recently Completed Westside Office Development Wateridge Two.

Business Editors/Real Estate Writers

Crown Realty & Development:

-- First Tenant At New Building Leases 150,000 Square Feet for Ten Years in a Transaction Valued in Total At $47.85 Million

-- Crown Realty & Development Completes Construction of First Building at Wateridge Two Office Development; Signs Lease for Seventy-Five Percent of Available Class A Office Space at New 200,000 Square Foot Building

In what is recognized as the largest office lease on Los Angeles' Westside to date in 2002, BAE SYSTEMS Controls has signed a long-term lease for 150,000 square feet of class A office space at Wateridge Two in a transaction valued at $47.85 million in total consideration, announced Robert Flaxman, President and CEO of Crown Realty & Development.

"BAE SYSTEMS focused its location choice at Wateridge Two on the quality of construction, employee amenities, geographic location and the unique tax benefits of doing business in unincorporated Los Angeles," said Flaxman. "When you consider all these factors, Wateridge Two is a distinctive choice with value added benefits clearly unavailable to any other office development on the Westside."

Gerald Porter and Matthew Miller of CRESA Partners' Westside office led an extensive site location search for BAE SYSTEMS and represented the company in its lease negotiations. Crown Realty & Development was represented by listing brokers Jeff Pion, Deron White and Lynn McCarthy of CB Richard Ellis during lease negotiations.

Additionally, Crown was represented by Scott Kalt and Ari Brumer, attorneys at law practicing with the Los Angeles office of Jeffer, Mangels Butler & Marmaro.

BAE SYSTEMS was represented by Richard Miller, partner with the Santa Monica law firm of Greenwald, Pauly, Foster & Miller.

"BAE SYSTEMS was searching for a class A office environment for their operations and CRESA Partners had identified 50 potential sites," noted Porter, Vice Chairman of CRESA Partners. "After an extensive location review, which started at the Northern edge of Long Beach and reached as far as the Conejo Valley, BAE SYSTEMS determined that a Westside location best satisfied its current employee base while continuing its presence in one of the nation's most well known aerospace markets. The fact that Crown's Wateridge development was able to provide a world-class environment at a substantial value in overall cost put it to the top of the list and ultimately secured the commitment."

BAE SYSTEMS Controls is relocating its operations from a facility located on the southwest corner of Airport Avenue and Bundy Drive adjacent to the Santa Monica Airport to the recently completed 200,000 square foot building at Wateridge Two.

The aerospace firm's new facility will be located at 5140-5150 Goldleaf Circle in an unincorporated area of Los Angeles County bordering Marina Del Rey, Playa Vista and Culver City. Wateridge Two enjoys a commanding hilltop position above the Marina Freeway adjacent to Slauson Avenue at the gateway to the emerging Playa Vista Business Corridor.

"BAE SYSTEMS, through its representatives at CRESA Partners, looked at over 50 alternatives in the Greater Los Angeles area before focusing their negotiations on Wateridge," noted Pion. "We are satisfied that our team identified the best location in their search, offering both value and quality in an area central to their operational preference. Doubly, I'm glad that we were able to keep such a significant employer on the Westside, really a 'win-win' situation that was good for Wateridge, BAE SYSTEMS and the local real estate market."

For more than 50 years, BAE SYSTEMS Controls has been a leading provider of electronic controls and avionics for military and commercial aircraft. BAE SYSTEMS Controls products can be found aboard most U.S. military aircraft and commercial airplanes.

Wateridge Two is the second phase of development at the Wateridge office development, where an existing 330,000 square feet of class A office space is currently 99 percent leased. BAE SYSTEMS' 150,000-square-foot commitment at Wateridge Two comprises the majority of available space at the second phases' first building, a 200,000-square-foot class A office building.

Wateridge is designed as a flexible, architecturally unique, and people friendly environment for companies seeking a top location in Los Angeles' Westside office market. Imbedded infrastructure includes flexible floor plans, fiber optic technology, and plug-and-play workstations with build-to-suit opportunities still existing at the site. Workforce amenities throughout the complex include a stream, hammocks, putting greens, open-air amphitheater and lush landscaping.

About Crown Realty & Development:

Founded in 1994, Crown Realty & Development is a private company focused on creating and adding value through the development, redevelopment and professional management of real estate. The portfolio of properties owned by Crown and its affiliates exceeds $400 million in value, all developed or repositioned internally. Crown's expertise includes complex urban design and planning, development, construction management, and entitlement processing. With a focus on Southern California, Crown's current portfolio includes more than two million square feet of office development projects in West Los Angeles and Orange County with management offices in Irvine, Beverly Hills, and West Los Angeles. Crown's principals have developed more than four million square feet of office and retail space over the past two decades.